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Anyone been banned from Oanda for Scalping

  • #21
  • May 5, 2008 9:16am May 5, 2008 9:16am
Yes I know someone who was banned from Oanda for scalping and making money.

He was taking advantage of several flaws in Oandas price feeds and using that to jump in and out for tiny profits. He was politely asked to take his business elsewhere.
  • #22
  • May 6, 2008 2:49am May 6, 2008 2:49am
But Frank,
profiting from the delay in price feed calls "latency trading" and that is the only trading that, they openly tell you, is forbidden. So if you trade like that, you know they will kick you.
  • #23
  • May 6, 2008 3:56am May 6, 2008 3:56am
Quoting CatMan
But Frank,
profiting from the delay in price feed calls "latency trading" and that is the only trading that, they openly tell you, is forbidden. So if you trade like that, you know they will kick you.
true, thats something that any broker would shut down.
If I Go Broke Trying Then I Will die happy.
  • #24
  • May 6, 2008 4:08am May 6, 2008 4:08am
Quoting FrankTheTank
Yes I know someone who was banned from Oanda for scalping and making money.

He was taking advantage of several flaws in Oandas price feeds and using that to jump in and out for tiny profits. He was politely asked to take his business elsewhere.

so that's proof of Oanda trading against their clients then ?
  • #25
  • May 6, 2008 4:22am May 6, 2008 4:22am
Quoting findcount
so that's proof of Oanda trading against their clients then ?
NO, :hypnotized:
If I Go Broke Trying Then I Will die happy.
  • #26
  • May 6, 2008 4:49am May 6, 2008 4:49am
Quoting findcount
so that's proof of Oanda trading against their clients then ?
Of course it trades against you.
A Market Maker has to trade against their clients. It's how a market maker works, but it doesn't mean it gains money you lose. As market maker is your counterparty in every trade, then it hedges its trades.
  • #27
  • May 6, 2008 4:53am May 6, 2008 4:53am
Quoting findcount
so that's proof of Oanda trading against their clients then ?
What ?

NO ! This this shows that they dont want people to exploit a flaw in a system to steal money !
  • #28
  • May 7, 2008 6:22am May 7, 2008 6:22am
sorry............:blushing:
  • #29
  • May 7, 2008 6:24am May 7, 2008 6:24am
Quoting findcount
sorry............:blushing:
What for?
  • #30
  • May 7, 2008 7:06am May 7, 2008 7:06am
Quoting metcalfe
Of course it trades against you.
A Market Maker has to trade against their clients. It's how a market maker works, but it doesn't mean it gains money you lose. As market maker is your counterparty in every trade, then it hedges its trades.
Hä?

Why do they have to take the counterpart in every trade? Oanda doesn't trade against its clients. I think the clients trade against each other. Oanda just hedge the outcome of the pool.

So if client A goes long with 100,000 units and client B and C go short with 100,000 units each, Oanda hedges this with a 100,000 short order in the interbanket market. But Oanda collects the spread of all 3 clients. A great concept...

Regards - Xaron
  • #31
  • May 7, 2008 7:39am May 7, 2008 7:39am
Quoting Xaron
Hä?

Why do they have to take the counterpart in every trade? Oanda doesn't trade against its clients. I think the clients trade against each other. Oanda just hedge the outcome of the pool.

So if client A goes long with 100,000 units and client B and C go short with 100,000 units each, Oanda hedges this with a 100,000 short order in the interbanket market. But Oanda collects the spread of all 3 clients. A great concept...

Regards - Xaron
I don't know why it has to be so complicated...
Of course Oanda aggregates clients' positions and hedges them in interbank. That's how a MM works, or at least should work.
But when you buy someone has to sell and if you sell someone has to buy. Isn't it? How can you buy an apple if nobody sell an apple?
When you buy EUR/USD someone has to sell EUR/USD and who do you think it is? I'll answer. Oanda.
Then, you are not the only client, so Oanda aggregates all clients' positions about EUR/USD and hedges in interbank the difference.
But if you win oanda loses, but it covers its loss in interbank plus your spread. (to simplify)
  • #32
  • May 7, 2008 8:46am May 7, 2008 8:46am
Quoting metcalfe
But if you win oanda loses.
That's simply not true. If I would be the only client, and would trade 100,000 units long, Oanda would hedge this by going long as well in the interbanket market. As they get a tighter spread than I get from Oanda, they win even if I lose. And they win as well if I win.

Regards - Xaron
  • #33
  • May 7, 2008 9:03am May 7, 2008 9:03am
Quoting metcalfe
I don't know why it has to be so complicated...
Of course Oanda aggregates clients' positions and hedges them in interbank. That's how a MM works, or at least should work.
But when you buy someone has to sell and if you sell someone has to buy. Isn't it? How can you buy an apple if nobody sell an apple?
When you buy EUR/USD someone has to sell EUR/USD and who do you think it is? I'll answer. Oanda.
Then, you are not the only client, so Oanda aggregates all clients' positions about EUR/USD and hedges in interbank the difference.
But if you win oanda loses, but it covers its loss in interbank plus your spread. (to simplify)
I don't see the complication. Say you're Oanda and you got connections with the interbank network and get an EU spread of 0.5. You just transfer your orders to the network and collect the 0.4 pip spread difference. You don't actually hold any positions yourself, those are the clients positions on their money, that money does not belong to the broker not does your "apple" - the apple is the network.
On the path to Enrichment.
  • #34
  • May 7, 2008 9:11am May 7, 2008 9:11am
Quoting Xaron
That's simply not true. If I would be the only client, and would trade 100,000 units long, Oanda would hedge this by going long as well in the interbanket market. As they get a tighter spread than I get from Oanda, they win even if I lose. And they win as well if I win.

Regards - Xaron
Maybe step by step we can make it.
If you go long 100k oanda go short 100k as your counterparty and long 100k in interbank. If you win 100$ where do yopu think they come from? From oanda because it is your counterparty. So OANDA LOSES!!!!
But Oanda hedges your position, so gets 100k long in interbank and covers 100$ that gave you plus spread. Then Oanda has 100$ - 100$ + spread and that is what MM has to work!
Then a MM HAS TO TRADE AGAINST ITS CLIENTS, but it doesn't mean MM has to cheat them. MM trades against as counterparty, but if you lose MM wins your money but it loses the same amount in interbank because it had to cover your trade.
  • #35
  • May 7, 2008 9:16am May 7, 2008 9:16am
Quoting Jurrasic
I don't see the complication. Say you're Oanda and you got connections with the interbank network and get an EU spread of 0.5. You just transfer your orders to the network and collect the 0.4 pip spread difference. You don't actually hold any positions yourself, those are the clients positions on their money, that money does not belong to the broker not does your "apple" - the apple is the network.
I don't really know.
But is there anybody who knows what a dealing desk is?
  • #36
  • May 7, 2008 9:36am May 7, 2008 9:36am
Quoting metcalfe
Maybe step by step we can make it.
If you go long 100k oanda go short 100k as your counterparty and long 100k in interbank. If you win 100$ where do yopu think they come from?
Your 100$ comes from the simple fact that you are placing a reverse order to the one you opened previously thus cancelling it at a better price for you.

Simply put, if I go to one shop and buy something for 1$ I am now "long" on that merchandize. Now just a bit later the price of that something rises to 1.2$. I can now sell my merchandize at 1.2$ and earn the 0.2$ difference. The broker (not all brokers though, but as I understand Oanda is one of those who act this way) carries out the buy and sell orders for me and in the process collects the tiny difference between the bid/ask difference (or spread) it gives me and the lower spread it gets through its direct interbank network access.

The only possibility for them to have an actual open position of their own in such a case is if the interbank network limmits their minimum order size to say one lot and then they might have like less than a lot non hedged position per pair. Now that they can either hedge, or maybe they don't have it at all because of their connections with the banks that handle even small orders like that for them. Or maybe they just don't care about it cause it's small orders that even out eventually anyway.
On the path to Enrichment.
  • #37
  • May 7, 2008 10:07am May 7, 2008 10:07am
Quoting Jurrasic
Your 100$ comes from the simple fact that you are placing a reverse order to the one you opened previously thus cancelling it at a better price for you.
Who places reverse order? Did you read my post.
I go long 100k
If I go long someone has to go short
Oanda goes short 100K as my counterparty
Oanda goes long 100K in interbank to be covered
I win 100$
Oanda loses 100$ that gives me
Oanda wins 100$ from interbank
Oanda has 100$ from interbank -100$ that gave me + my spread (not true because is my spread - spread from interbank).
That is to simplify because there is aggregation.
I don't know how to make it any simpler
  • #38
  • May 7, 2008 10:38am May 7, 2008 10:38am
Quoting metcalfe
Who places reverse order? Did you read my post.
I go long 100k
If I go long someone has to go short
Oanda goes short 100K as my counterparty
Someone, somewhere, over the rainbow way up in the interbank network goes short. Neither you or Oanda knows or cares who that is, it's called liquidity - phousands of banks, funds and what not that are always placing orders one way or the other and buyers find sellers and vice versa. In the case of big brokers they have their own personal contracts with large banks. The banks provide the liquidity and earn their own addition to the spread. Same as a chineese producer who makes your jeans for 2$ and earns 1$ net profit when selling to the exporter who makes 2$ by selling it to the local stores in your country who then makes 50$ from you buying them. Only difference is with a currency pair you can both buy and sell, but you pay that spread to everyone on the way anyway.
On the path to Enrichment.
  • #39
  • May 7, 2008 10:44am May 7, 2008 10:44am
Quoting Jurrasic
Someone, somewhere, over the rainbow way up in the interbank network goes short. Neither you or Oanda knows or cares who that is, it's called liquidity - phousands of banks, funds and what not that are always placing orders one way or the other and buyers find sellers and vice versa. In the case of big brokers they have their own personal contracts with large banks. The banks provide the liquidity and earn their own addition to the spread. Same as a chineese producer who makes your jeans for 2$ and earns 1$ net profit when selling to the exporter who makes 2$ by selling it to the local stores in your country who then makes 50$ from you buying them. Only difference is with a currency pair you can both buy and sell, but you pay that spread to everyone on the way anyway.
There is no rainbow.
I KNOW WHO GOES SHORT IF I GO LONG. IT'S OANDA BECAUSE IT IS MY COUNTERPARTY. ELSE EXPLAIN ME WHAT A COUNTERPARTY IS AND WHAT IT DOES.
  • #40
  • Last Post: Jan 19, 2012 2:40am Jan 19, 2012 2:40am
[quote=pipal;1721436]I think it's better to ask the question like this "Anyone been banned from Oanda for Scalping and Making Money Consistently?"

I don't think a MM or Oanda would care about what styles you are trading if you are losing money all the time or ones are just trading mini lots. They would be very happy to encourage you to scalp or trade as much as you can provided that you are losing money all the time.

If you Google the subject, then YES there are some horror stories of manipulation aginst successfull scalpers...heard someone turned 40 $ into 2600$ in 2 weeks, then slippage destroyed him after...Have no proof...just read it...itīs scary if the Casino doesnīt give you your good earned trade...or prevents you with tricks...
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